Metaplatforms Inc. META held its Meta Connect 2022 on Tuesday, where it showcased its Metaverse lineup, announced additional partnerships, and also released its next generation Search Pro headset.
What happened: after the event, KeyBanc capital markets analyst Justin Patterson maintained an Overweight rating and price target of $196 on Meta stock.
The company’s Metaverse vision remains a more than 10-year endeavor that requires decades of investment, Patterson said in a statement. Among the other challenges, “a chicken-and-egg dynamic remains between user growth and compelling content,” he added.
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While the analyst praised the Quest Pro for its impressive feature set, he expressed doubts about its launch due to its $1,499 price tag and limited battery life. The analyst also noted that competition was intensifying apple inc AAPL work on your own mixed reality headset, Sony Group Corporation SONY VR2 on the way and Valve work on a different headset.
Why it matters: Patterson said, “Until devices reach mass-market prices and move hundreds of millions of units, we believe the metaverse will still be viewed as a niche, more related to gaming than social and productive use cases.”
“In short, we continue to view metaverse discussions as marginal to the core debates,” he added.
With the Metaverse vision still a long way off, the health of the core business remains the focus, Patterson said. The analyst predicts that the company’s fundamental performance will be driven by the level of underlying engagement, the sensitivity of the ad cycle, the extent to which AdTech investments are paying off in terms of investment improvements, and the way management is managing operational and… Estimates capital, determines expenses.
Price promotion: According to the Meta, Tuesday’s session closed down 3.92% at $128.54 Benzinga Pro data.
